Episode #008: Is a PAYING Lead Worth More To Your Business?
Episode #008: Is a PAYING Lead Worth More To Your Business?
You've probably heard that a low ticket offer is a great way to build your list, generate customers, and fill your list with PAYING LEADS... but are those leads really worth more?
In today's episode we break down the truth, the myths, and the realities of trying to grow your list with only a low ticket offer via ads and organic marketing.
Hint: It takes more than one stream of leads to grow.
Tune in to learn what the best practices are for paying leads, when they work, and when they don't.
Links Mentioned on the Show From Zach:
Full Transcript:
This is Not Your Average Online Marketing Podcast, episode number eight. And in this episode, we're talking about the true value of leads, when to use a free lead, when to use a paid lead and what the difference is. So, let's get into it. Hey, hey, hey, not so average marketer. I'm really excited for today's episode, which I know I say every week, but I'm going to keep saying it because I'm always really excited to share with you. And what I wanted to talk about this week was less of an action that you take in your business, and more of a shift in the way that we need to think. So, I started noticing this kind of trend in the industry, and I think I'm guilty of it too. And I think we're all a little guilty of it, especially with kind of the low ticket offer craze that's been going on, where it's like, "Oh, low ticket offers are the way to go. You're going to get amazing value by having a low ticket offer in your business."
The actual belief is not that a low ticket offer is great. In fact, I think low ticket offers are phenomenal for business. I think they're really strategic and really smart. The actual thing I want to talk about is when someone says, "Oh, someone who pays is a higher value lead than someone who doesn't pay to be on your email list, right?" We've probably all heard this before that it's better to have a customer than a lead, and I really want to break down what this means and why it's not untrue, but I think there's a little more to the story than is being given. And I think it's really important that we talk about that.
So, I want to start by talking a little bit about Costco. For those of you who don't know, Costco is this wholesale warehouse that you can buy a membership to in the US. And you basically go there and you buy everything in bulk. You get dozens of rolls of toilet paper. You get chicken by the multiple pounds. You buy everything in bulk, and in exchange for that, there is a cost savings. Now, Costco has this chicken that you can buy pre-cooked. It's a rotisserie chicken. It's a whole size chicken and it's five bucks. And I remember growing up, we used to get that a lot. My mom would use it to make dips. She would use it to make dinner. She would use it to make quesadillas. We would get it all the time because it was so dang cheap.
And in retrospect, I remember thinking, "Wow, $5 for a whole chicken. That's crazy cheap." Well, it turns out that it is crazy cheap. In fact, Costco doesn't make money on their $5 chickens. They actually use those chickens to get people in the door. And so, I started thinking a little bit back on my upbringing, and I realized that when my mom would come home with this chicken, she would often come home with something else. See, Costco understands that it's okay to lose a little bit of money on the chicken because they're making money on selling the other products. And this is the first lesson that I want you to understand.
See, with low ticket offers, we're often told like, "Oh, it's so much better to have a customer." But what we're often not told is that a lot of these low ticket products that we see out there are loss leaders. You're actually leading someone into becoming a customer at a loss. And I'm not saying that that's a bad thing. In fact, it can be great for your business. It can be great for the customer. It means you're creating massive value for a low price. You're generating customers. You're growing your email list. However, for those who are getting started in business and may only have one or two products, it can be really hard to recoup that cost. So, while in some sense, maybe getting somebody in the door leads to more sales, it doesn't always work for every business. I think that's one of the areas that needs to be talked about more.
So, with that being said, I think it's important that you understand I'm not dogging on the customer first perspective. It can be beneficial. It can help. In fact, we just ran a five day bootcamp on Facebook ads, which I'll talk about in another episode, I'll talk to you about the results that we got, but we had almost 20% of people that bought a $10 ticket become ongoing membership members, ongoing members of our membership. I tell you that because that is a really high conversion rate compared to a normal launch. Why is that? Because people who pay to be somewhere are more likely to show up, and that's just the reality. Some people, they want to have some investment. They want to be invested before they show up.
Also, I think there's this other side of the coin that we don't talk about. We say when people pay, they pay attention. But the other thing is when people pay, they want the content and it shows that they're a more qualified lead to begin with. What do I mean by that? Well, the real is somebody who pays for my bootcamp may have been somebody that would've signed up when it was free and still converted, right? They're still going to show up. I think that it is important to understand that we had a higher conversion rate because people paid, but we also could have spent the same amount of money, run it free, and potentially made the same amount of profitability.
So, what does that really mean? Well, I want to talk about something that I think we in the online marketing space forget. And that is, there's this old, old, old school marketing thought process that says, people need seven exposures to your products before they actually make a purchase on average. Now, there's some studies that have said it's even higher that with the age of the internet and people seeing so many offers so frequently, they actually need to be exposed to a product multiple times beyond seven before they make a decision.
What does that have to do with customer versus freebee? Well, here's the reality. I think that, especially in the online course space, things have gotten saturated, and that's not a bad thing. This happens with every space. Somebody comes up with an idea, it works, more people tune in, and everybody creates their own subtle variation. Nothing wrong with that. But some people have noticed that there's lots of options. You re not one in a million anymore or you're not one in a million in terms of uniqueness. You're one in a million in terms of there's a million other options, right?
So, people are coming into this space now with a healthy dose of skepticism. They're not 100% confident that you can solve their problem. Maybe it's because they've been burned by courses in the past. Maybe it's because they are short on cash. Maybe it's just because they've seen so many offers they don't know which one is the right one for them. And so some people really just need to be exposed to you before they make a decision to purchase. And this is where I start to have a little gripe with this whole customer-first as the only way to grow your business. See, some people just need to be exposed to you and your product and build a sense of trust with you first.
I want to tell you a little story. We have a client that has worked with us for five plus years, and they originally joined our email list on a freebie. Now, that person has ascended. They took courses. They then joined our coaching program. We then worked with them one on one, and then they joined our agency, and we opened up our agency doors. That client, client X has spent over $50,000 with us over the course of my business. And I just want to impress upon how important it is to think about that because it would be really easy to have missed that customer by saying, "Oh, I only want people who join as a customer-first." They just needed to know that our process and our products were good before they were ready to buy. They wanted to experience me on live streams. They wanted to experience me in their inbox. They wanted to experience my podcast, and then they made a commitment.
Now I share that because I get it. That is the lightning strike story. Not everybody who joins our email list for free ends up having over $50,000 lifetime value. What I want you to take away from this is that there is this importance of nurturing an audience, right? Whether somebody becomes a customer first or a lead first, you still have to nurture them. You still have to provide value and content. And so, I'm not saying that you shouldn't generate customers first. I'm not saying that. What I am saying is that while you're generating customers with a low ticket offer in your funnels, in your advertising, in your marketing, you should also be growing your email list. It's not a bad idea to grow your list in tandem with growing your customer base because the reality is you never know who's on that list.
I have another story. I have a mentor of mine who had a CEO of a multimillion dollar company reach out to them and say, "Hey, I'd love to work with you. I've never bought anything before. I just signed up for one of your freebies and I've been watching you for a year." Y'all, the other thing is not everybody needs or wants the low ticket offer that you have to sell. But when you have multiple freebies, multiple podcasts, multiple live streams, multiple blog posts, that's when you start to attract people, okay? And this is a snowball game. It's a game where things start to snowball and grow over time. You guys know that old saying that's like, "Oh, if you push a snow snowball ball down a hill, it's going to get smaller. But if you push a snowball down a hill covered in snow, it gets bigger." And it's those small, daily, consistent actions that grow the value of your leads.
Now, one other thing that I want to say is that you have to realize that it is an easy way out to simply say, "Well, if somebody becomes a customer, they're more likely to buy." Well, yes, that's true. However, there's so many people out there. One of the things that I hear from a lot of people is I'm doing this because it's my calling, or I'm doing this because I want to make an impact, or I want to help people. And one thing that I say is, "Well, are you only willing to help people who are willing to pay you before they know you?" And that is something I really want you to think about. Are you only willing to help people who are willing to pay you first?
So, thinking about that, it really becomes what kind of impact do you want to make? How do you want to reach more people? How do you want to grow? See, I also talked about this one other example, and then I'll give you some really tangible practical steps that you can take to make this work. But one example I gave is we all know who Kim Kardashian is, right? I think it's no secret she is pretty famous in her own right. She's got a big following. And when you go to Kim Kardashian's Instagram, what you're going to find, she has over 250 million followers, 250 million followers. Okay. Here's the thing.
Do you think that Kim Kardashian goes, "Well, this is great and all, but these followers really only matter to me if they're paying me." She has beauty brands. She has shape wear brands. She has fragrance brands, and not everyone that follows her is immediately buying those. But do you think that she stops creating content simply because not everybody on her Instagram is paying her? Or do you think that she leverages that Instagram to get more people engaging with her content, her TV shows, her products, her businesses. The reality is it makes a difference even if someone's not paying you yet. It makes a difference in terms of what she can charge her sponsored post. It makes a difference in terms of who consumes her content. Y'all, here's the other thing, you never know who's going to share your content and reach a potential customer. I think it's really important that we stop saying, "Oh, customer first is the way to go." I'm not saying that's wrong. What I'm saying is there's more to the equation than simply generating customers upfront.
So, let me do a super quick recap and tell you what we are doing in our business to make sure that we're serving as many people as possible while still growing the business. So, number one, we talked about the importance of realizing that it is often a loss leader when you try to generate a customer first. You don't always make money on the front end. Number two, some people simply need to be exposed to your content and your products before they make a purchase. There's a healthy amount of skepticism online these days. And we have to realize that not everybody's ready to buy right off the bat. Number three, we talked about how one of our free leads became a $50,000 lifetime value client. Number four, the importance of nurture and creating a connection with people before you ask them to buy can sometimes increase your conversion rates and get more people to engage with you. And number five, I gave you that example of Kim Kardashian on Instagram. Love or hate her, she's growing a massive audience. And if you want to make a massive impact, it does start with growing an audience.
How do we actually have rubber meet the road? What is the actual takeaway from this audience? Well, for me, it's threefold. Number one, I think you should be running an ad 24/7 simply to grow your email list. Okay, run an ad to grow your mail list. Run a simple lead generation ad and always be adding people to your list. And once they join your list, make sure you have a really simple nurture sequence in place. It doesn't have to be crazy. It doesn't have to be insane. It can be three to five emails that just onboards them and tells them what to expect from you, how to connect you. And just as a note, if you are like, "How do I run lead generation ads? How do I write my first follow up sequence?"
I want to let you know that inside our membership in the month of October, we're actually teaching our students how to create a really simple five email follow up sequence that promotes one of their low ticket offers or moves people onto a wait list for their core offer. And inside the membership already from the month of September is how to run simple lead generation ads. We have students that are adding 100 plus people a week to their email list. We've got students that have added hundreds of people to their email list, and we're teaching you how to set that up, how to create the sequences. And in November, we'll also be talking about low ticket product creation if you don't have one yet. So, if you want to check that out, you can head over to join.notyouraveragemembership.com. Again, it's join.notyouraveragemembership.com, and we'll start teaching you how to grow the list, how to engage people, how to put a low ticket offer out there. Now, that's number one.
Number two, I want to encourage you to start creating regular content because we talked about this in the episode. It's really important that you nurture people. People aren't just going to go, "Oh, I met this guy on the internet. Let me give him thousands of dollars." They're going to say, "Hey, I met this guy on the internet. He seems cool. Let's see what he's about." And so, for me over the last five or six years, I've created dozens of blog posts. We've got over 150 podcast episodes, and we just continue to create good content because once somebody's on my list, I can email them that content. I can tell them about my stuff. I can tell them how to learn more, how to engage with me.
Perfect example here, not to be too meta, but if you're listening to this podcast, and maybe you've listened to all seven episodes of the Not Your Average Online Marketing Podcast you might be thinking, "Hey, this membership is sounding better and better. Maybe I will go check it out." And maybe you'll think, "Hey, this membership sounds cool, but I'm not ready." But either way, I'm going to continue to release a podcast each week to nurture my audience and engage them with my content. And I can see my products. So, with blog posts, podcasts, videos on YouTube, it doesn't matter. You can seed exactly what your products are. So, even when people aren't ready to buy, they're still being exposed to what it is that you do, how they can work with you, and they continue to kind of move down that process.
The third thing that I'll say is consider creating a low ticket product that you do drive customers to on the front end. So, I think really important that I emphasize this. My goal with this episode is not to demonize low ticket products or demonize front end low ticket sales. I think they work incredible organically. I think they can work great with advertising. In fact, we have a low ticket offer that we are constantly running with Google ads, and it's been working really great for us. We are so happy with the results that we're seeing. And I'm not saying that a front end customer is bad. We get lots of front end customers, and it works great, and we love it. And it's a great part of our business. It generates revenue for us. It brings in revenue every single month, and we're going to continue to do that, but we're going to neglect the people who aren't ready to make a front end investment. I think that's what I want you to take away from this, right?
You can have a front end product without having a ton of that's the only way to work with me. There's no other way. Don't try to work with me any other way because the only way is my low ticket product. That's all I'm saying. There's other things that you can do besides just that, but don't neglect it. We found, like I told you at the beginning that people converted at a higher rate when we charged them for a challenge. We find that people who pay us are more likely to take action. We find that people who enjoy our paid products become some of our best case studies. So, I'm not saying neglect the paid opportunities. I'm saying embed them along with regular content, regular engagement, and regular list building.
So, as we wrap up this episode, I just want to recap. We talked about the reasons that you should consider a low ticket product, the reasons you might not consider it, but more importantly, the three things that you should be doing is number one, always growing your list, super important. Don't neglect that. Number two, always be creating regular content. And number three, if you have a low ticket offer, promote it, promote it with ads, promote it organically, but always be generating customers.
The thing I want you to take away from this episode is that there is no one right approach. It's this holistic approach where low ticket products are great, but they can be a loss leader, but they can also generate more revenue on the back end, and list building is great, but it can be a little harder to convert people, but it also grows your influence, and your influence is what helps you sell more. So don't take free versus paid as the only way to think about it. Think of it as free and paid. Think of it as both. So, if you enjoy this episode and you want a full breakdown, you can head over to heartsoulhustle.com/nyap008. That's N-Y-A-P 008 for Not Your Average Podcast 008.
Now, before we wrap up, I just want to encourage you. If you are on the fence about the membership, feel free to check it out and ask any questions. If you ever head over to join.notyouraveragemembership.com, we actually have a little chat box in the bottom right hand corner where you can jump in and ask my team and I any questions you have about the membership and we're happy to answer them. So, the membership we've been working on for a few months. We've got a healthy amount of people in there, and we would love to support you in growing your list, creating your sequence, and developing low ticket products so that you can start a consistent stream of growth and revenue in your business. And that's just the first three months. If you want to learn more about it, head over to join.notyouraveragemembership.com, and you can read everything that's coming out. Y'all, I really appreciate you turning into this week's episode. I hope you have an incredible rest of your weekend, and until next time, this is Not Your Average Online Marketing Podcast.
